Framing Digital Compliance Cultures: A Qualitative Conceptual Analysis of Institutional Readiness in AML Governance

Abstract

This paper explores how institutional readiness for anti-money laundering (AML) digital compliance is shaped not solely by technological infrastructure, but by organizational culture, leadership framing, and interpretive regulatory engagement. Drawing on institutional theory, organizational culture theory, and the Technology-Organisation-Environment (TOE) framework, the study offers a qualitative conceptual analysis that reframes digital transformation in AML governance as a cultural shift rather than a purely technical upgrade. While financial institutions are increasingly urged to adopt Regulatory Technology (RegTech) tools, implementation remains uneven, particularly in developing markets. Thematic findings suggest that compliance is often performed symbolically rather than substantively, with leadership playing a pivotal role in framing legitimacy and encouraging adoption. Regulatory ambiguity further complicates institutional response, requiring culturally embedded interpretation. The paper argues that trust, both technical and relational, is critical to organizational readiness, and that digital compliance success hinges on participatory processes and leadership-driven narratives. This study contributes to the literature by emphasizing the socio-institutional dimensions of digital AML compliance and calls for regulators to go beyond policy issuance by fostering capacity-building and cultural alignment. It concludes that meaningful AML governance demands a rethinking of risk, compliance, and responsibility in the context of evolving digital ecosystems.